TheChek News Flow

WSJ : Possible Chinese Nuclear Testing Stirs U.S. Concern

Possible Chinese Nuclear Testing Stirs U.S. Concern

Beijing might secretly be conducting small nuclear tests at its Lop Nur site, report says

China might be secretly conducting nuclear tests with very low explosive power despite Beijing’s assertions that it is strictly adhering to an international accord banning all nuclear tests, according to a new arms-control report to be made public by the State Department.

The coming report doesn’t present proof that China is violating its promise to uphold the agreement, but it cites an array of activities that “raise concerns” that Beijing might not be complying with the “zero-yield” nuclear-weapons testing ban.

The concerns stem from the high tempo of activity at China’s Lop Nur test site, extensive excavations at the site, and Beijing’s purported use of special chambers to contain explosions.

Another factor feeding U.S. suspicions is the interruption in past years of data transmissions from monitoring stations on Chinese territory that are designed to detect radioactive emissions and seismic tremors.

China might be secretly conducting nuclear tests with very low explosive power despite Beijing’s assertions that it is strictly adhering to an international accord banning all nuclear tests, according to a new arms-control report to be made public by the State Department.

The coming report doesn’t present proof that China is violating its promise to uphold the agreement, but it cites an array of activities that “raise concerns” that Beijing might not be complying with the “zero-yield” nuclear-weapons testing ban.

The concerns stem from the high tempo of activity at China’s Lop Nur test site, extensive excavations at the site, and Beijing’s purported use of special chambers to contain explosions.

Another factor feeding U.S. suspicions is the interruption in past years of data transmissions from monitoring stations on Chinese territory that are designed to detect radioactive emissions and seismic tremors.

(DJ) *U.S. Concerned About Possible Chinese Nuclear Testing, Report Says

WSJ : Apple’s New $399 iPhone SE: Long Live the Small Screen and Home Button

Apple’s New $399 iPhone SE: Long Live the Small Screen and Home Button

Those who have resisted $700-plus iPhones with big screens and Face ID finally have a solid choice

Download attachment-1

There’s a brand new iPhone—and by “brand new” I mean an iPhone that looks like an old iPhone with the name of an even older iPhone.

Don’t worry, I’m here for you in this confusing and difficult time.

Announced on Wednesday, the $399 second-generation iPhone SE is now Apple’s AAPL -0.86% most affordable smartphone. It looks almost exactly like the iPhone 8, which it replaces and was previously priced at $449, yet has a faster processor and the same lower price as the previous iPhone SE, which the company stopped selling in September 2018.

The new model will be available for preorder this Friday and will begin arriving on April 24 by mail—given that most Apple stores are closed.

Sure, it might seem like minor stuff—especially against the backdrop of, you know, an economy and society ravaged by a pandemic—but there are people who have been anxiously awaiting this very iPhone for years. Yes, this is the phone for:

1. Those who don’t want a phone the size of an Olympic pool.

2. Those who love the traditional home button like their first born.

3. Those who think phones above the price of $700 are totally ludicrous.

The SE’s traditional home button design and its “smaller” 4.7-inch screen fly in the face of the iPhone 11, iPhone 11 Pro and iPhone 11 Pro Max, which have screens 5.8 inches or larger and start at $699.

But what exactly is new here? And is $399 actually a good value for what you get? I spent time talking with Apple executives to get some answers.

What’s actually new here?

Good luck spotting the very, very minor physical differences between an iPhone 8 and an iPhone SE. (Hint: look at the location of the Apple logo on the back!) Inside, however, this is a very different phone. It has Apple’s latest A13 Bionic processor—the same exact one in the higher end iPhones.

Download attachment-2

That enables faster performance across the entire system, according to Apple, and also unlocks some camera tricks. The single 12-megapixel rear camera supports smart HDR, portrait mode for people—sorry, no beautiful blur around Fido’s face—and can record 4K video. I look forward to testing out the camera in my full review. The $399 model also comes with 64 GB of storage. (The largest 256 GB model is priced at $549.) All are available in black, white and red.

But isn’t this screen still sort of big?

There are some out there who may be disappointed by the iPhone SE’s 4.7-inch screen considering that the old iPhone SE—modeled after the iPhone 5—had a 4-inch screen. To that, Apple says this is a very popular phone size; it has sold more than 500 million 4.7-inch iPhone models.

That enables faster performance across the entire system, according to Apple, and also unlocks some camera tricks. The single 12-megapixel rear camera supports smart HDR, portrait mode for people—sorry, no beautiful blur around Fido’s face—and can record 4K video. I look forward to testing out the camera in my full review. The $399 model also comes with 64 GB of storage. (The largest 256 GB model is priced at $549.) All are available in black, white and red.

But isn’t this screen still sort of big?

There are some out there who may be disappointed by the iPhone SE’s 4.7-inch screen considering that the old iPhone SE—modeled after the iPhone 5—had a 4-inch screen. To that, Apple says this is a very popular phone size; it has sold more than 500 million 4.7-inch iPhone models.

FT : Iran embarks on biggest IPO as economy struggles

Iran embarks on biggest IPO as economy struggles

Sale of shares in state-run holding company generates income for government

Iran embarked on its biggest-ever initial public offering on Wednesday, selling 10 per cent of the shares of Shasta, its wealthiest state-run holding company, to generate income for the government as it struggles with the economic consequences of coronavirus and US sanctions.

The shares in Shasta — the investment arm of Iran’s Social Security Organisation which is country’s leading pension fund — were largely bought by retail investors generating about IR70tn ($440m based on the open market rate).

The multibillion-dollar holding company’s interests span petrochemicals and cement to finance and shipping.

President Hassan Rouhani hailed the IPO as the biggest in “the history of Iran’s bourse” and said it benefited “around 2m shareholders on the stock market”.

At a cabinet meeting on Wednesday Mr Rouhani said he urged other ministries and armed forces to sell the shares of their major holding companies, too.

Since Donald Trump pulled the US out of the nuclear accord in 2018 and imposed tougher sanctions, many Iranians have turned to the Tehran Stock Exchange to protect their money against inflation of 34.8 per cent and a more than 60 per cent devaluation of the national currency.

The surge in investment has made Iran’s capital market into one of the best-performing in the world with the main index, Tedpix, growing 220 per cent over the past year.

The coronavirus pandemic, which has hit Iran hard, has worsened its economic prospects and sparked anxiety as the value of savings falls. The authorities have encouraged people to invest in capital markets and have vowed to accelerate the privatisation of state-run companies.

“Offering the shares of Shasta to the public can certainly lessen the budget pressure on the government and helps the Social Security Organization to keep paying the retired, pay for unemployment insurance to an increasing number of jobless people and insure coronavirus patients,” said the director of an investment company. “The bourse is doing very well because other alternative sectors such as housing, gold and foreign currency markets are not attractive.”

Iran has vowed not to bow to US pressure despite a huge drop in petrodollars — the country’s lifeline. But Covid-19 is expected to deepen the recession and lead to a fall in tax revenue.

Mr Rouhani has opposed any draconian quarantine policies, arguing that a weakened economy cannot afford to pay people to stay at home. Instead, he has ordered the country to largely return to its normal life as of next week.

Iran has called on the US to lift sanctions and appealed for international help including a $5bn loan from the IMF to tackle the coronavirus fallout.

Jihad Azour, director of the IMF’s Middle East and Central Asia department, said: “Since we have had limited engagement with Iran in recent times, the process of obtaining the information we require to assess the request is taking time.”

Asked about reports in Iranian media that the US was against the IMF supporting Iran, Mr Azour said “every member of the fund has the same right of access, financing and resources subject to the funding and an approval by the executive board”.

The IMF forecasts that Iran’s economy shrank 7.6 per cent last year, not as severe a contraction as it previously predicted. But the fund believes it will contract a further 6 per cent this year after previously expecting output to be flat in 2020 because of the impact of Covid-19 and the collapse in oil prices.

But Iran’s central bank governor said on Tuesday that the IMF estimates were “irrelevant” and “not based on precise information”. Abdolnaser Hemmati said the economy contracted in the first half of the last Iranian year, which ended on March 19, but started growing in the second half before the virus outbreak. “Our worst estimate suggests a contraction of 1.5 per cent [this year].”

The Islamic republic hopes privatisation of more state-run companies in the coming months will help it narrow its budget deficit.

“I apologise to people . . . If our hands were more open, we would have assisted more . . . We have many resources but we cannot access them because of sanctions,” Mr Hemmati said. “But we get financial resources from anywhere we can.”

Download Iran_embarks_on_biggest_IPO_as_economy_struggles___Financial_Times.pdf

SCMP : Germany arrests five Islamic State suspects planning attack on US forces

Germany arrests five Islamic State suspects planning attack on US forces

* The Tajik nationals were arrested after raids targeting several flats and six other locations in North Rhine-Westphalia

* The five men had been planning to attack targets, including US airbases and had already ordered bomb parts online

German police have arrested five Tajik nationals on suspicion that they were members of an Islamic State (Isis) group terror cell that had been planning attacks on US forces stationed in Germany, prosecutors said on Wednesday.

Four of the suspects were arrested after dawn raids on Wednesday targeting several flats and six other locations in the western state of North Rhine-Westphalia. Another Tajik national was previously detained.

The five were also allegedly planning attacks on individuals they deemed critical of Islam, prosecutors in the city of Karlsruhe said.

The suspects – named as Azizjon B., Muhammadali G., Farhodshoh K., Sunatullokh K. and Ravsan B. – are accused of joining Isis in January 2019 and initially planning to carry out attacks in Tajikistan.

They then switched their focus to Germany after receiving instructions from two high-ranking Isis leaders in Syria and Afghanistan, prosecutors said.

The five men had been planning to attack targets, including US airbases and had already ordered bomb parts online, as well as stocking up on firearms and ammunition.

They also planned an assassination attempt on a person they believed had expressed Islam-critical views in public, and had already begun spying on the intended victim, prosecutors said.

Two of the suspects are also accused of travelling to Albania to carry out an assassination attempt in exchange for US$40,000. However, the project failed and they returned to Germany.

Germany has long warned of the threat of more violence ahead after several attacks claimed by Isis, the bloodiest of which was a truck rampage through a Berlin Christmas market in December 2016 that left 12 people dead.

In June 2018, German police said they foiled what would have been the first biological attack with the arrest of a Tunisian suspected Isis supporter in possession of the deadly poison ricin and bomb-making material.

More recently, police in the western city of Offenbach arrested three men in November 2019 for allegedly planning a bomb attack in the name of Isis.

That same month, a Syrian was arrested in Berlin accused of having procured key components for an explosive device and discussing bomb-making tips with other suspected Islamists in an online chat group.

Germany’s security services estimate there are around 11,000 Islamic radicals in Germany, some 680 of whom are deemed particularly dangerous and capable of using violence – a five-fold increase since 2013.

Germany remains a target for jihadist groups, in particular because of its involvement in the coalition fighting Isis in Iraq and Syria, and its deployment in Afghanistan since 2001.

Chancellor Angela Merkel has allowed in more than one million asylum seekers since 2015 – a decision that has driven the rise of the far-right Alternative for Germany (AfD) party, which charges that the influx spells a heightened security risk.

(ThePaypers) How private equity will drive payments consolidation in 2020

How private equity will drive payments consolidation in 2020

Wednesday 15 April 2020 12:30 CET | Author Raluca Constantinescu | Voice of the industry

Andrew Backen, Partner at Equistone Partners Europe, shares with us the key factors attracting private equity investors and elaborates on the inflow of investment from private equity firms

2019 was a busy year of consolidation within the global payments industry, with a string of large-cap deals that included FIS’ record-breaking USD 35 billion acquisition of Worldpay. 2020 has offered no signs of a lull in M&A activity. Worldline’s USD 8.6 billion acquisition of France-based digital payments provider Ingenico, announced in February 2020, fired the starting gun on further, industrial-scale consolidation of European payments this year.

Multiple strategic rationales have driven, and will continue to drive, the ongoing consolidation of the payments industry. Chief among these is the search for scale. Currently, the global payments market remains relatively fragmented. A clear opportunity exists to step-change the scale of businesses through M&A, perhaps to establish a leading market position. For example, Nets’ merger with Concardis Group, completed in January 2019, created a business with approximately EUR 1.3 billion of net revenue across Germany and the Nordics, making it one of Europe’s largest payments groups.

Payments companies are also seeking assets that can diversify their customer base and customer offering, by expanding into complementary geographies and services respectively. PayPal announced two purchases in 2018 exemplifying this approach: the USD 2.2 billion acquisition of iZettle, which provided access to the company’s established POS capabilities in new markets including Sweden and Latin America, and the circa USD 400 million acquisition of the global payout platform Hyperwallet, enhancing PayPal’s suite of payment solutions for ecommerce platforms and marketplaces.

Alternatively, payments companies might look to add entirely new, high-growth business areas through M&A, rather than developing these platforms from scratch. Visa’s acquisition of cross-border payments company Earthport in 2019 provided the US-based payments technology provider with a stronger foothold in the substantial account-to-account payments market.

The inflow of investment from private equity firms

These various types of strategic transactions fuelling consolidation within the global payments industry have not just been limited to large-cap acquisitions by public-market giants. The mid-market, which might be tentatively defined as comprising companies valued below USD 500 million, also continues to be very active. And a striking trend within the mid-market of the payments industry is the inflow of investment from private equity firms to drive this consolidation.

Certain larger private equity firms do invest in large-cap transactions; for instance, the Nets–Concardis merger was backed by private equity investors Hellman & Friedman, Advent International, and Bain Capital. However, it is in the mid-market that private equity firms are perhaps most actively deploying capital to both acquire payments businesses and then support these companies with ‘add-on’ acquisitions.

At Equistone, for example, having invested in Small World Financial Services, a leading UK-based money transfer company, in November 2018, we subsequently supported Small World with the add-on acquisition of France-based international payments company MoneyGlobe earlier in 2020. The transaction addresses two of the key strategic rationales, adding a complementary geography through MoneyGlobe’s coverage of its domestic French market and generating further scale for the business.

In this respect, private equity is an excellent partner for mid-market payments companies seeking to grow acquisitively. Many private equity firms regularly support ‘buy-and-build’ strategies at their portfolio companies, contributing not only capital, but also their established networks for originating new deals, their financial and technical expertise, and their experience in executing M&A including post-deal integration. But if mid-market payments companies’ appetite for participating in the ongoing industry consolidation is set to continue, what factors are attracting private equity investors to help fund and drive these acquisitions?

Key factors attracting private equity investors

Alongside a highly amenable landscape for supporting a buy-and-build strategy, into which private equity investors can deploy their record ‘dry powder’ reserves of unspent capital that Preqin estimates at almost USD 2.5 trillion, we see three key drivers.

Firstly, the payments industry offers the growth potential to support strong returns for private equity firms’ underlying investors. McKinsey has forecast that global payments revenues will reach USD 2.9 trillion by 2022, with cross-border payments driving this expansion and growing by 74% by 2026.

Secondly, the industry is being transformed by ongoing digitalisation. Whilst in some sectors of payments – and countries – more traditional routes to market will endure for a long time, supporting a company through a successful digital transformation is a clear pathway to creating value. An example of this at work is Global Blue, a leading Switzerland-based international provider of traveller tax refunds. The company was acquired by Far Point for USD 2.6 billion in January 2020, having previously been jointly owned by private equity firms Silver Lake and Partners Group and, before that, by Equistone. Global Blue fuelled its growth, with EBITDA growing from circa EUR 35 million to circa EUR 97 million during the period of Equistone’s backing, in part by successfully digitising transactions such as VAT refunds.

Thirdly, active industry consolidation and corporates’ interest in acquiring payments businesses presents private equity investors with an attractive exit environment when they seek to sell the companies in which they invest. Increasing competition on the buyside and the steadily diminishing number of high-quality assets available as consolidation rolls on both serve to support asset valuations.

Accordingly, trade buyers from across the globe were aggressive in acquiring private-equity-backed payments companies in 2019. This ranged from US-based Mastercard buying the real-time payments arm of Nets, shortly after the company’s merger with Concardis, for USD 3.2 billion, to Ant Financial, the payments arm of Chinese internet giant Alibaba, moving into Europe through the USD 700 million acquisition of UK-based WorldFirst.

Strategic acquisitions for a range of rationales, upward pressure on valuations, and continued investment from private equity have emerged as some of the key dynamics within the global payments industry in recent years. All indicators point to M&A continuing at pace in the coming year, as payment providers seek to raise private equity investment, drive further consolidation, and attract interest from strategic buyers.

>>> ECB's Makhlouf (Ireland): skeptical about a V-shaped recovery; I expect it t

ECB's Makhlouf (Ireland): skeptical about a V-shaped recovery; I expect it to be more gradual

- ECB stands ready to support citizens and economies if events show we need to do more

FT : Hedge funds urge EU regulators to scrap short-selling curbs

Hedge funds urge EU regulators to scrap short-selling curbs

France, Belgium, Spain, Austria and Greece consider extensions of restrictions

Hedge funds are urging European regulators to scrap bans on the short-selling of shares, as markets begin to settle in the wake of a sharp sell-off last month.

National authorities in five countries are considering whether the bans have done their job in stabilising stock prices, following a 30 per cent fall in the Euro Stoxx 600 benchmark triggered by fears over the spread of coronavirus.

The benchmark has since recovered as much as 15 per cent, prompting hedge funds to claim that extending bans would be damaging, pushing up the all-in costs of trading.

“The evidence from these short-selling bans is consistent with past experience: they have increased volatility, reduced liquidity, and acted as a tax on all investors,” said Bryan Corbett, chief executive of the Managed Funds Association, which represents hedge funds such as DE Shaw, Renaissance Technologies, Citadel, Two Sigma Investments and Third Point.

The month-long bans will start to lapse this week, starting with France on Thursday. Restrictions in Spain, Austria and Belgium are due to end after the close of business on Friday while a ban in Greece expires next week. Italy’s ban will continue until mid-June.

Other regulators across Europe, notably in the UK and Germany, did not impose bans of their own.

Last week Robert Ophèle, chairman of the French market regulator, Autorité des marchés financiers, said that he was inclined to extend his country’s ban, but would consider all data before coming to a decision.

Short selling is a practice widely used by hedge funds and involves managers borrowing shares and then selling them, hoping to buy them back later at a lower price before returning them and pocketing the difference.